Dear USET/USET SPF Family,
We write today to inform you of four major updates regarding the ongoing Tribal opioid litigation proceedings. A summary of each update is listed below, and more detailed information on each update can be found in this memo from Hobbs Straus Dean & Walker.
Tribal Opioid Settlement Trust Fund Allocations
The percentage of over $1 billion in funding that each Tribal Nation will receive from the opioid abatement trust funds created pursuant to the Tribal opioid settlements was finalized and released. The trustees of the abatement funds are expected to make the first distributions to Tribal Nations within the next few months (pending Tribal Nations submitting the required information.) Detailed information on the allocation formula can be found in the memo. All Tribal Nations are eligible to participate, but must submit participation forms and payment information in order to receive the funds. More information on the participation forms can be found here.
McKinsey and Co. Litigation
The litigation against the consulting firm McKinsey and Co. entered the early stages of the Tribal bellwether case selection process. McKinsey and Co. are alleged to have engaged in various "legal harms" by helping its pharmaceutical company clients market and advertise opioids. The cases against McKinsey have been consolidated into one "multidistrict litigation" (MDL). The judge overseeing the MDL will run "bellwether" trials - essentially test cases - to determine the litigation prospects of the parties involved. A group of 50 potential Tribal cases have been selected, and the potential Tribal bellwethers have until June 23, 2023 to consent to proceed with their cases in the Northern District of California. It is expected that the final selection of the bellwether case will occur in late summer or early fall.
Endo International Bankruptcy Proceedings
Bankruptcy proceedings for opioid manufacturer Endo International Plc are currently before a judge. Tribal Nations may need to take action in connection with these proceedings soon. In 2022, Endo International, a pharmaceutical company that produces opioids like Percocet, filed for bankruptcy after reaching a nearly $6 billion deal with its creditors. The deal is contingent on the sale of Endo's assets. There is a specific process for the asset sale (described in the memo). If a certain bidder is successful, a voluntary trust of $550 million will be set up for opioid claimants. Of the $550 million, $15 million (roughly 3%) would be set aside for Tribal Nations.
Purdue Pharma Bankruptcy Restructuring Plan
The courts have affirmed the bankruptcy restructuring plan for Purdue Pharma's bankruptcy proceedings. This finally clears the path for creditors (including Tribal Nations) to recover funds from Purdue. More detailed information on the previous and new plans can be found in the memo, but overall Tribal Nations are expected to be distributed approximately 3% of the expected $7 billion estate.
For more information, please contact Ashton Martin, USET SPF Health Policy Analyst, at amartin@usetinc.org.
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